Benefacts chair criticises Government's reasoning for terminating the nonprofit

Benefacts was first set up in 2014 at the behest of former Department of Public Expenditure and Reform secretary-general Robert Watt, with equal funding from the State and from philanthropic concerns. File picture: Gareth Chaney/ Collins

The reasons given by the Government for terminating a well-regarded State-funded not-for-profit providing financial information on the charities sector have been dismissed by the now-defunct company.

In a letter to the Public Accounts Committee, the chair of Benefacts says the body’s employees “were astonished” to be told in July 2020 by the Department of Public Expenditure and Reform — to whom Benefacts had been accountable — that its plan was to terminate the organisation’s State funding.

The chair, Tom Boland, said Benefacts had subsequently learned “that an evaluation had been performed by officials without any engagement with us or request for submissions”.

Mr Boland said he had written his letter to “correct the record” concerning the demise of Benefacts, which was first set up in 2014 at the behest of former Department of Public Expenditure and Reform secretary-general Robert Watt, with equal funding from the State and from philanthropic concerns.

He said the department’s contention it has no need for Benefacts’ services and is not a user of them is “not the case”.

Mr Boland said in 2018 and again in 2021 Benefacts had been asked by the department to provide detailed analyses of the pay and PRSI profiles of all nonprofits receiving money from the State, with officials from the department subsequently commenting “there was no other source of such high-quality, full population data”.

Regarding a letter from the department’s current-secretary general and successor to Mr Watt David Moloney to the PAC in March of this year which asserted “the State’s grant was far in excess of the quantifiable benefits derived from Benefacts”, Mr Boland said that statement was “directly contradicted” by an analysis compiled by consultants Indecon for the department in 2019.

He said Indecon’s report had stated that “the information provided by Benefacts are likely to be in excess of the costs involved” and that the consultants’ evaluation “suggests that... access to a centralised database is likely to be very cost effective”.

“Aside from the... value-for-money concerns of State actors, the sector and the public are the poorer for the loss of timely access to this trusted and impartial body of information,” Mr Boland said.

This is something that the board greatly regrets. We wound up the company with very heavy hearts.”

Addressing the claims in Mr Boland’s letter, a department spokesperson said that while the Indecon review had considered the “non-quantifiable value” of Benefacts, the “quantifiable benefits fell short of the quantifiable contributions being made by Government”.

Last month, the Central Statistics Office also wrote to the PAC to laud the information it had received from Benefacts regarding the financial circumstances of Irish non-profits, stating the information had “addressed many of the coverage issues” the CSO had previously experienced in reporting on the sector.

Addressing the CSO statement, the department spokesperson said the CSO had been informed of the decision to shut Benefacts in 2020, and the department had afforded a 20-month period for another public body to assume responsibility for funding the body.

“No public service body identified an appreciable business need to assume this role,” the spokesperson said.